Reverse calculation of service tax
This query is : Resolved
09 May 2013
Dear all,
In case of a gross bill amount charged is 1200000/- & person entitle for abatement of 75%. How to reverse calculate the service tax liability by taking abatement?
Assume tax rate applicable for yr. is 10.3%
Pls. reply with steps?
In case of a gross bill amount charged is 1200000/- & person entitle for abatement of 75%. How to reverse calculate the service tax liability by taking abatement?
Assume tax rate applicable for yr. is 10.3%
Pls. reply with steps?
09 May 2013
when abatement 75%
then tax on 25%
10.3% of 25% is 2.575%
now gross bill is inclusive of s.tax.
so divide 1200000 by 102.575 and multiply by 2.575, this will result into service tax
(1200000/102.575)x2.575 = 30124.30 service tax.
and value of service 1200000-30124.30 = 1169876.70
then tax on 25%
10.3% of 25% is 2.575%
now gross bill is inclusive of s.tax.
so divide 1200000 by 102.575 and multiply by 2.575, this will result into service tax
(1200000/102.575)x2.575 = 30124.30 service tax.
and value of service 1200000-30124.30 = 1169876.70
09 May 2013
Thank you very much Vikas:)
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